Insurance Law Update - South Carolina Attempts to Clean Up the ‘Intellectual Mess’ Over the Meaning of ‘Occurrence’ in Construction Defect Claims - February 2011

more+
less-

Supreme Court of South Carolina

In Crossmann Communities of North Carolina, Inc. v. Harleysville Mut. Ins. Co., ___ S.E. 2d ___, 2011 WL 93716 (S.C. January 7, 2011), the Supreme Court of South Carolina held that there is no coverage under a commercial general liability (CGL) policy for liability that arises from nothing more than the natural and probable consequences of defective construction.

Harleysville Mutual Insurance Company issued a CGL policy to the developers of waterfront condominiums. After the condos were built and sold, the purchasers sued the insured developers, alleging that defective construction of the condos’ siding installed by subcontractors had resulted in significant water intrusion, causing substantial decay and deterioration. After settling the purchasers’ claims for $16.8 million, the insureds filed a declaratory judgment action to determine if coverage existed under the Harleysville policy. The parties stipulated to the facts, and the trial court ruled that the CGL policy provided coverage under the “subcontractor exception” to the “your work” exclusion.

The South Carolina Supreme Court reversed.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

Published In: Civil Remedies Updates, Construction Updates, Insurance Updates, Products Liability Updates, Residential Real Estate Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Sedgwick LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »